Computation
Your basic annuity is computed based on your length of service and “high-3”
average salary. You also receive credit for unused sick leave if you retire
on an immediate annuity. To determine your length of service for computation,
add all your periods of creditable service, and the period represented by your
unused sick leave, then eliminate any fractional part of a month from the total.
High-3 Average Salary
Your “high-3” average pay is the highest average basic pay you
earned during any 3 consecutive years of service. These three years are usually
your final three years of service, but can be an earlier period, if your basic
pay was higher during that period. Your basic pay is the basic salary you earn
for your position. It includes increases to your salary for which retirement
deductions are withheld, such as shift rates. It does not include payments for
overtime, bonuses, etc.
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Computation
Here is how the CSRS annuity formula is calculated:
Years of Service
|
What You Receive |
First 5 years of service
|
1.5 percent of your high-3 average salary for each year |
Second 5 years of service
|
Plus 1.75 percent of your high-3 average salary for
each year |
For all years of service over 10
|
Plus 2 percent of your high-3 average salary for each
year. |
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Reductions in Annuity
Your annuity will be reduced if:
- You retire before age 55 (unless you retire for disability or under the
special provisions for law enforcement officers, air traffic controllers,
and firefighters); Your annuity will be reduced by one-sixth of 1 percent
for each full month you are under age 55.
- You didn’t make a deposit for service performed prior to October
1, 1982, during which no deductions were taken from your pay (non-deduction
service after that date is not used in the computation of benefits if the
deposit is not paid);
- You didn’t make a redeposit of a refund for a period of service that
ended before October 1, 1990;
- You provide for a survivor.
- To provide a full survivor benefit for your current or former spouse,
your annuity will be reduced by 2.5 percent of the first $3,600, plus
10 percent of the annuity over $3,600.
- To provide a survivor annuity for a person who has an “insurable
interest” in you, your annuity would be reduced from 10 to 40 percent,
depending on the difference in your age and the age of the person named.
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Cost of Living Adjustments
Your annuity will be increased periodically by cost-of-living increases that
occur after your retire. Your initial cost-of-living increase will be prorated
based on how long you have been retired when that cost-of-living increase is
granted.
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Maximum Payable
The maximum benefit you can receive from CSRS is 80 percent of your high-3
average salary, plus credit for your sick leave. This limit generally affects
only those who have more than 41 years of service when they retire.
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Special Computation for Law Enforcement Officers,
Firefighters and Nuclear Materials Couriers
Years of Service
|
What You Receive |
First 20 years of CSRS law enforcement officer, firefighter and/or nuclear
material courier service
|
2.5% of your high-3 average salary for each year |
All remaining CSRS service
|
Plus 2% of your high-3 average salary for each year |
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Disability Retirement Computation
If you retire for disability, you may be guaranteed a minimum annuity equal
to the smaller of:
- 40 percent of your “high-3 average salary”, or
- the regular annuity obtained after increasing your service by the time
between your retirement and your 60th birthday.
The guaranteed minimum applies if you are under age 60 when you retire and
your earned annuity based on your actual service is less than this minimum.
Exception:
The guaranteed minimum does not apply if you are receiving military retired
pay and/or compensation from the Veterans Administration in lieu of all or part
of the military retired pay. However, if your earned annuity plus your military
benefit (or compensation) is less than what it would have been under the guaranteed
minimum, the annuity is increased to bring it up to that level.
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